Protecting himself while actively dooming hundreds of startups to failure
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Should we feel bad when we sell a stock and it goes down?
Pretty much defines Sili V. culture.
* Was it illegal? Nope.
* Did it only have selfish goals? Yep
* Did it necessarily doom others to losses by timeliness and first-come-first-served? Yes
* Did he have equity of access with others? Hell no. he's head of the queue.
It's not "wrong" in a narrow sense but most people are on point #2, they dislike Thiel (as I do) and so "judge" him to political philosophy, not to legalism.
He's not markedly more wrong than other people in his situation. He may well be significantly smarter and asymmetry in the economics space, is held to be counter-productive overall. Of course, you're naieve or a fool or both if you don't exploit it.
Maybe you have a different interpretation of "wrong" ? And, I can't fault his logic: This is basic 'win' thinking. Why hang around? What's in it for him, long or short term to wait?
I'm trying to be objective here, since my dislike of his political philosophy is pretty extreme.
Wearing the loss would be stupid. His ability to survive the losses isn't really material. If he had custody of other people's money and acted to preserve it, he acted wisely to their needs too. What he did I believe hastened the end for less wise people, with less ability to weather the risk and has downstream consequences which follow a run on a bank, in terms of impact on operating business. Stripe and other payment systems suspending clearing, payroll not happening is going to cause problems at large.
He's no more "wrong" than Pelosi or her husband or many other US senators and representatives are, trading against their heightened sense of awareness of the market. If Pelosi trades on inside information she may actually be worse than Thiel in this case (my belief is she has no prior knowledge which would exceed the insider-trading limits, and is technically not in breach of law even when I think what she does is totally reprehensible and inappropriate for an elected leader)
Withdrawing one's own money from a bank is not wrong in any sense, not legally or morally. Your attempt to conflate his actions with elected officials skating around insider-trading laws (even if not technically crossing them, as you presume) is nonsensical and unfair.
What ggm and others like him want to say (but don't because they know how stupid it sounds), is that Thiel should have told everyone what he had learned/deduced about SVB's stability ... and not taken his own money out.
I sat through a social media shitstorm over a bank run here in Australia and listening to randoms phoning me with a "hot tip I'll thank them for" was insane. Read other pieces on HN to see other people's "I dodged a bullet" posts: no.. you didn't dodge a bullet you were part of the magazine of bullets which brought it on.
Is this HN? Is this real life? These actors might collude and self-prote t each other often, but they're not a national army, theyre not some unified body. I feel like people just canNOT accept that a bunch of their peers are vultures and that by bumping elbows with them, they're complicit. But that's exactly the truth.
From the numbers I have seen, was in mild trouble but nowhere near insolvent before Thiel and those like him caused the bank run.
If me taking my point out of my account causes you problems, that sounds like a you problem. I absolutely do not freaking get this.
Whether or not something is legal is independent of whether or not something is wrong.
Just to be clear, I'm not opining whether or not what Thiel did was right. I'm making a general point here.
I'm not exactly sure what actions people think he should have taken. Thiel is not responsible for the poor risk management on the part of SVB.
There are plenty of valid criticisms of Thiel. This is not one of them, and makes the claimant look like a fool.
Why do they always have to bring race into this?
> It was the result of hubris, and self-inflicted destruction, by VCs who are rich, black and arrogant
Geez I feel like I'll be banned from the internet just for posting this for comparative purposes. Why is it open season on me and nobody else?
Money and wealth is the differentiator, not race.
Who is this mysterious "they" you speak of?
If they were merely illiquid then we should not have closed them but supplied liquidity.
Either way, Theil is not to blame, at least not for this.
Bank runs are a psychological construct, not an economic one. They are based on rumors, not facts. Deposit insurance is intended (and usually successful) to prevent runs by ensuring that depositors will be made whole even if the institution does become insolvent, because a run will destroy any banking institution.
The failure of SVB was caused by those who rushed to get their money out based on fear.
Hour by hour I am in horror at the standard of "normal" that people will defend because they can't see it for what it is or imagine an alternative. Capital capital jobs jobs! Hoorah! This is the way.
It sucks to see powerful people getting a better deal than regular people, but the unfairness in this situation was caused by bank (mis-) management, not Thiel.
Funny enough, much as I detest the guy, I think the hate directed at him for this is pure cognitive dissonance and refusal to see the bigger picture+problem.
Is it a few rotten apples or is the hacker news or Y Combinator community itself thats rotten?